According to IBM’s annual report, the average cost of a data breach in 2022 is $4.35 million. With a price tag that high, it’s no surprise that 60 percent of companies that experience a data breach close their doors within six months after the attack. Numbers like these are eye opening, and show that it is worth investing in cybersecurity to protect your business from a costly breach. However, how can you be sure that your cybersecurity ROI is where it should be?
Today, cybersecurity is no longer an option; with 66% of small and medium businesses attacked in the past 12 months, it’s a necessity no matter the size of your business. Many companies get hung up on the cost, or are overwhelmed by the number of cybersecurity vendors or tools currently available.
A cost-effective way to get end-to-end protection and prevent data breaches is through Cybersecurity as a Service (CSaaS). Top-tier solutions include everything you need to protect your digital assets and network from intrusion, and to enable rapid detection, response, and recovery–which equates to a greater cybersecurity ROI.
Let’s explore how the cost of a data breach in 2022 affects your cybersecurity ROI.
How Much Can a Data Breach Cost You?
Data breaches are not just enormously costly, they are often avoidable. Imagine a scenario where hackers attack a medium-sized company, exposing 50,000 consumer records that contain PII (personally identifiable information). That company may spend upwards of $2.5 million cleaning up the mess, paying fines, notifying customers, providing free identity theft protection, and securing the network. The cost of cybersecurity would be a small fraction of that cost and could help avoid the attack altogether.
The formula for calculating cybersecurity ROI is this:
Breach Reduction = Breach Likelihood (%) x Breach Impact ($)
The reduction of financial losses is essentially your ROI. You come to that figure by taking the breach likelihood (%) and multiplying that by the breach impact in dollars.
Another way to look at it is to divide your cybersecurity investment into your breach reduction. For example, if you considered spending an additional $300,000 for cybersecurity protection and your risk reduction was $3,000,000, your ROI would be 10x. With CSaaS costs are usually notably lower, meaning an even higher ROI.
Other factors to consider when you are measuring cybersecurity ROI are:
● Asset valuation and the related risk.
● Vulnerability — how vulnerable is your data?
● The severity of an attack.
● Threat level.
● Asset exposure.
● Security controls in place.
According to Forbes Magazine, cybercrime cost businesses $6.9 billion in 2021, and only 43% of U.S. companies feel financially secure enough to weather an attack in 2022. That is why maximizing your cybersecurity efforts and improving your ROI is essential.
The Long-Term Impacts of a Data Breach
Data breaches can devastate a company regardless of size. SMBs will be most affected, and many will go bankrupt or have to shut down completely, but enterprise companies are not without risk. Beyond the financial losses, there are other even more damaging effects of a data breach.
Some of the devastating long-term impacts of a data breach include:
● Loss of company credibility and customers’ trust.
● CEO reputation damage.
● Stock plunge.
● Negative online reputation, which is difficult to erase.
● Sales plummeting.
● Extra expenses.
● Loss of intellectual property or trade secrets.
● Business disruption and system downtime.
● Exposure of employee, customer, or vendor data, putting them at risk of identity theft or fraud.
● Scare off reputable employee candidates.
● Legal issues and compliance sanctions.
6 Ways to Maximize Your Cybersecurity ROI
Your cybersecurity investment directly impacts your cybersecurity ROI. When faced with the possibility of catastrophic losses, it’s easy to see why maximizing your cybersecurity budget is critical. A typical company spends roughly 6-14% of its IT budget on cybersecurity. Usually, those same companies invest 3.2% of their gross revenue in IT spending. Although cybersecurity threats are rising, IT budgets are being cut due to the economic climate and problems across every industry. It’s more important than ever before to maximize your cybersecurity dollars.
To maximize your cybersecurity budget:
- Be Proactive: Take a proactive approach rather than a reactive one. Perform a complete security audit and identify weak areas. Concentrate your cybersecurity budget on those areas.
- Protect Your Data: Protect your company data at all costs. Invest in effective detection tools, network monitoring, secure email, access control, authentication barriers, and keep good backups. Prioritize protecting your “sensitive” data that contains personal information on people or company trade secrets.
- Invest in Training: Invest heavily in cybersecurity awareness training for all staff members to help prevent attacks. Additionally, cultivate a cybersecurity culture within the company. The majority of attacks start with human behaviors, and your staff can be your first line of defense against intrusions.
- Outsource Cybersecurity: Outsourcing your cybersecurity will allow you to reduce the number of IT staff and ensure rapid response and recovery. Be sure to upgrade hardware and software to save money in the long run and prevent attacks on known vulnerabilities.
- Institute a Zero-Trust Model: Using a zero-trust model to reduce your attack surface and limit devices connected to your network.
- Implement a CSaaS Solution: Consider CSaaS (Cybersecurity as a Service) to affordably protect against data breaches. CSaaS is a complete package solution that covers everything from 24/7 monitoring and attack prevention to rapid response and recovery after an event. You pay for CSaaS on a subscription model and get top-tier cost-effective protection. Referring back to the cybersecurity ROI formula, reducing breaches while optimizing cybersecurity spend is the ultimate method to increase cybersecurity ROI.
Cyberleaf’s CSaaS Solution Maximizes Your Cybersecurity Budget
It’s essential to spend your cybersecurity dollars wisely. As discussed above, breach reduction is the clearest way to maximize your cybersecurity ROI, choosing the best tools and services is the most direct path to cutting down on high-impact breaches.
Cyberleaf CSaaS offers businesses affordable top-tier protection that can be deployed by your existing resources in a fraction of the time of doing it yourself. With Cyberleaf, you get a team of experts at your disposal, active threat mitigation, 24/7 detection, alerts, and response, as well as advanced protection that your own IT department may not be able to provide.
You cannot put a price on protection against digital threats. Hackers are improving their game every day; you must keep up. Using Cyberleaf’s CSaaS, you are not only protecting your valuable digital assets but also drastically improving your cybersecurity ROI in the process. Learn more about Cyberleaf’s CSaaS and how we can help protect your company.